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Baseball, Basketball, Science, School Teachers, and Supply and Demand

Mostly we follow the political and economic news here at The Central Standard Times, being the civic-minded and clinically glum types we are, but occasionally we’ll turn a hopeful eye to the sports pages. There’s usually some dreary political and economic subplot there, however, and so it is with the case of the big deal baseball story about Bryce Harper signing with the Philadelphia Phillies
In case you’re one of those atheistic commie pinko America-hating types who don’t closely follow our national pastime, Harper is one hell of a player. There’s a strong case to be made that he’s not as good a player as the more clean-shaven Mike Trout, who is under contract to the Los Angeles Angels for the next months and then seems headed toward a big payday, but after six spectacular seasons with the Washington Nationals Harper was clearly the best player on this season’s free agent market, so the bidding war wound up at $330 million for 13 years in Philadelphia. Our faith in the ruthless and sometimes crazy laws of supply and demand tell us that even that eye-popping amount is reasonable compensation given the large number of teams seeking a player with Harper’s rare statistics, even if the atheistic commie pinko America-hating types will want to compare it to a school teacher’s pay, and we note with some regret that Harper’s bottom-line agent had to take politics into account in the negotiations.
A presumably apolitical sports writer at The Log Angeles Times reports that the Los Angeles Dodgers and San Francisco Giants offered Harper more money, but not enough more to compensate for the wide gulf of tax rates between California and Pennsylvania. California has the nation’s highest state income tax rate at 13.3 percent, Pennsylvania imposes a rare flat tax rate of 3.07 percent on both millionaires and minimun wage earners alike, and that makes hiring a rare talent such as Harper far more expensive in the Golden State. We imagine the same is true of those rare talents in the arguably more important science and technology and engineering and mathematics fields, not to mention school teachers, and being longtime red-in-tooth-and-claw capitalists we can’t help noticing how excessive taxation and other political interventions distort markets.
Even the almighty market forces don’t determine the ultimate outcome in sports and life, though, and neither do the futile interventions of mere humans and their petty politics. The Phillies will likely be better with Harper on the roster, but he’ll only be one of nine guys in the lineup, and he can’t guarantee a championship. The Los Angeles Angels haven’t won much with the arguably Trout in the lineup, The Los Angeles Lakers paid big buck for the arguably best-of-all-time LeBron James in its starting five and seems likely to miss the playoffs, and some guys are we’ve never heard of and don’t seem to have any impressive stats on the Denver Nuggets are going currently toe-to-toe with the almighty Golden State Warriors in the National Basketball Association’s western division. Our beloved New York Yankees are expected to contend for a championship this next baseball season, despite that state’s high tax rate and other left-wing craziness.
Somehow the the high-tax states seem to be faring to be faring well in the arguably more important science and technology and engineering and mathematic fields, and their school teachers aren’t so restive, and we can only surmise that all sorts of geographic and demographic climatic factors somehow figure in it all. Here in our part of Kansas the Wichita State University Wheatshockers are above .500 in conference and overall play even in a down season, the University of Kansas Jayhawks have ended a 14-year run as Big XII conference championships but the Kansas State University Wildcats are still in the chase, and the local economy is doing pretty good despite all the trade wars and tax cuts and tax hikes and other human interventions in the free market and the best efforts of our fellow human beings.
At this point all we have to say , about both sports and politics, is let the best team win.

— Bud Norman

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Minimum Wages and Minimal Logic

Those mischievous economists at the Congressional Budget Office are back in the news, this time with a report suggesting that raising the minimum wage would also raise the unemployment rate.
The notion that raising the cost of something such as unskilled labor might also reduce the demand for it will seem reasonable enough to anyone with a rudimentary understanding of economics, but it has provoked an outcry among those with a more sophisticated view of these things. There apparently are studies out there by some experts or another suggesting that raising the cost of something doesn’t affect the demand for it and that people will gladly continue paying a higher price for something long after the cost has exceed its actual economic value, no matter how many centuries of economic history sense suggest otherwise, and we are told that it would be downright anti-science to argue with an expert’s study. Advocates for an increase in the minimum wage also note that the CBO has concluded that minimum wage workers would make more money if the minimum wage were increased, which will also seem reasonable enough to anyone with a rudimentary understanding of economics, and argue that so far as social justice and all the jazz goes the lost jobs would be offset by the gains those lucky enough to keep their swelled wages.
Neither argument is convincing. The president and any economists supporting his call for raising the minimum wage to $10.10 an hour clearly haven’t spent much time lately in the drive-thru lane of a fast-food restaurant, where they surely would have encountered uncouth and innumerate workers whose feeble efforts could not possibly provide a profitable return on that exorbitant amount, and we don’t doubt there are far more of them than the 500,000 or that the CBO has estimated will get the axe. There’s also the distinct possibility that a few million more over-paid workers will demand a bump up above the minimum and find that they are no longer worth the cost. Despite our dissatisfaction with these workers’ performances we are not so insouciant about their fates as the more high-minded activists seem to be, and we don’t share the view that they’re better of unemployed at $10.10 an hour rather than employed at the current rates.
This is a most unfashionable point of view, however, and it remains to be seen if it will prevail. The last time the CBO raised such a fuss was when it reported that more than a million people will be induced to leave the labor force rather than relinquish their Obamacare subsidies, and presidential and bien-pensant opinion concluded that they’d all better off and free to pursue careers in the arts. As much as we’re looking forward to the artistic renaissance that will surely flower from all those fast-food workers laid off to make room burger-flipping robots, it doesn’t seem likely to spur an economic revival any time soon.

— Bud Norman